At the 2024 United Nations Climate Change Conference (November 11-22) in Baku, Azerbaijan, accountability experts tackled the question of why climate finance needs to be not just bigger, but better. In an event titled “Why Accountability is Key to a Successful Just Transition”, held at the World Bank Group Pavilion, Ibrahim Pam, Chairperson of the Inspection Panel, moderated a panel featuring Sonja Derkum (Independent Redress Mechanism, Green Climate Fund), Andrea Kaempf (Independent Complaint Mechanism, International Climate Initiative), and Jonathan Mead (Transparentem).
Ibrahim Pam began by describing the drive within financing institutions to harmonize and work faster to deliver on the urgency of climate financing by multilateral development banks, currently projected to reach USD 120 billion by 2030. “The challenge that we face now,” he said, “is how to do all of this—deliver more quicky and effectively—while respecting integrity standards and the need to protect communities from adverse environmental and social impacts, and to avoid maladaptive outcomes that weaken resilience.”
The panelists then responded to the question of why accountability is so important to climate finance. Sonja Derkum, Head of the Independent Redress Mechanism at the Green Climate Fund, linked the overall need for accountability in climate finance with the specifically project-based, community-oriented accountability that independent accountability mechanisms (IAMs) have a mandate to provide. She explained how IAMs can give voice to communities that are affected by climate projects and hopefully enable “better projects going forward.”
Andrea Kaempf, Head of the Complaints Office of the Independent Complaint Mechanism of the International Climate Initiative, called for not just more, but better climate finance, illustrating her argument with examples of real-life cases: “The urgency of climate change requires us all to spend money wisely and make sure that it actually achieves the intended benefits and reaches the communities…and not just throw it out the door.”
Jonathan Mead, Director of Investigations at Transparentem, highlighted the need for an additional perspective on violations of human rights beyond development project sites. Transparentem is a civil society organization that seeks to transform industries by allying with workers and communities to uncover abuses in global supply chains and drive labor and environmental justice. Mead called for a focus on the supply chains of projects that are seen to be part of the just transition. Such transition projects can only be successful, he added, if upfront due diligence, controls, and monitoring are combined with access to a functioning grievance redress mechanism: “If any of those legs of the stool fail, the stool will topple over.” Andrea Kaempf reiterated this point: “IAMs are one part of a complex system to make projects sound and benefit communities, not harm them.”
Among recurring issues with development projects that are submitted to IAMs, Sonja Derkum listed resettlement challenges, inadequate stakeholder consultation, and the lack of project-level grievance mechanisms. Kaempf added, “37% of all complaints by communities raise issues of inadequate due diligence, consultation, and disclosure.” Early consultation can therefore help deliver within the lifetime of a project. Furthermore, as Pam stressed, accountability not only provides redress for communities, it provides long-term learning for financing partners on how to design and implement successful projects.
Summarizing the session, Pam noted the intersectionality of environmental and social safeguarding, and integrity systems that prevent or detect abuse of climate financing. He urged financing institutions to continue to ensure the effectiveness of these guardrails. “This is essential for ensuring development effectiveness,” he said, “and also for achieving the mission to end extreme poverty and boost shared prosperity on a livable planet."
In the brief Q&A concluding the session, a representative of the civil society group Recourse stated that climate finance both neglects consideration of human rights and lacks transparency. In response to a question on how they might engage with discussions and action on climate finance, panelists acknowledged that IAMs do not define what counts as climate finance. However, they emphasized that human rights are embedded in the environmental and social frameworks of multilateral development banks, and thus apply to all financed projects. Panelists also welcomed the support of civil society organizations to reach out to communities.
COP29 in Baku was labelled the “finance COP,” and was characterized by a fraught fortnight of negotiations on the climate deal on finance to be pledged toward the just transition. Amidst the demands for large-scale accountability of developed nations to address climate change that disproportionately affects the Global South, project-level accountability remains fundamental. As one of the only events addressing this subject, the panel in Baku played a vital role in ensuring that IAMs and civil society continue to speak on behalf of affected communities around the world. Accountability has to be at the core of the transition to clean development if it is to be just and sustainable.
The World Bank Accountability Mechanism Secretariat was pleased to support the organization of this event. Watch the recording of the session here.
